Following the Dark Money: Bloomberg to NYU to Virginia’s OAG?

Mark Herring (far right) at 2016 launch of AGs United for Clean Power Plan.

Here is a counter-factual mental exercise for you. Imagine that former Attorney General Ken Cuccinelli, a conservative skeptic of climate change, had applied for a grant from the conservative-libertarian Koch Foundation to cover the cost of hiring an AG staff member dedicated to litigating environmental groups. Then imagine that Cuccinelli’s office had to compete nationally with other AG offices around the country for the grant, that the Koch Foundation would fund only those projects that best advanced its anti-climate change agenda, and, if approved, that the Koch Foundation would help select the attorney.

Would that have been a news story? Would the Washington Post and every other Virginia newspaper have given it front-page scandal coverage? Would Democrats and environmental groups decry the use of private dollars to hire lawyers to wield the legal powers of the AG’s office to harass and intimidate Koch brothers enemies?

Now flip the scenario. In the real world, Attorney General Mark Herring’s office submitted an application on Sept. 15, 2017, to the New York University School of Law’s State Energy & Environmental Impact Center for funding to hire a NYU School of Law fellow “as a Special Assistant Attorney General” devoted to climate-change issues. The Virginia AG’s office, stated the application, “would work with the State Impact Center to identify, recruit and extend offers to appropriate candidates.” The Center is backed by billionaire, former New York Mayor, and anti-global warming champion Michael Bloomberg.

The State Impact Center announced in a December 2017 press release that Virginia would be hiring a special prosecutor. However, Michael Kelly, director of communication for the AG’s office, told Bacon’s Rebellion: “No such funding was received and no such attorney is employed here.”

Herring has a history of activism on climate change. In 2016 he joined a group spearheaded by then-New York AG Eric T. Schneiderman that included AGs from 16 states and the Virgin Islands to combat global warming. Participants committed to work together on initiatives such as “ongoing and potential investigations into whether fossil fuel companies misled investors and the public on the impact of climate change on their businesses.”

“As a Commonwealth and as a nation, we can’t just put our heads in the sand because we are already confronting the realities of climate change,” said Herring in a statement included with the official announcement. “I’m proud to have Virginia included in this first-of-its-kind coalition, which recognizes the reality and the pressing threat of manmade climate change and sea level rise. I’m looking forward to working with my colleagues to explore opportunities to address climate change, encourage the growth of our clean energy sectors, and build a cleaner, more sustainable future.”

The Schneiderman initiative disbanded a few months later when confronted with open records law requests and negative media attention. Last year Schneiderman resigned from office amidst allegations of multiple abusive sexual relationships. But AG activism continues, funded in part by Bloomberg through NYU’s State Energy and Environmental Impact Center.

Law enforcement for rent. Chris Horner, a Virginia resident and senior fellow at the right-of-center Competitive Enterprise Institute (CEI), has documented how wealthy environmentalists like Bloomberg have bankrolled climate-change activism by state attorneys generals. In his August 2018 report, “Law Enforcement for Rent: How Special Interests Fund Climate Policy through State Attorneys General,” he chronicles how activists began seeking a sympathetic attorney general as early as 2012 to subpoena their opponents’ records. Wrote Horner:

Public records reveal the anatomy of what began as an “informal coalition” of AGs to use the legal system in pursuit of an overtly political agenda in coordination with activists and plaintiffs’ lawyers. That coalition disbanded under open records and media scrutiny, but it has now reconstituted through a program by which donors fund, privately hire, and place investigators and prosecutors in AG offices. It uses a nonprofit organization to pass the funding through and to provide the OAGs with a network of “pro bono” attorneys and public relations services. In return, OAGs provide office space to the privately hired prosecutors; agree they are there to “advance[e] progressive clean energy, climate change, and environmental legal positions”; and provide regular reports about their work.

Led and funded by former New York Mayor Michael Bloomberg, this scheme hires “Research Fellows,” which it then places as “Special Assistant Attorneys General.” …

“[The modus operandi] uses nonprofit organizations as pass-through entities by which donors can support elected officials to, in turn, use their offices to advance a specific set of policies favored by said donors. It also uses resources that legislatures will not provide and that donors cannot legally provide directly. The budget for climate policy work alone is in the tens of millions of dollars per year.

Horner argues that the hiring of privately funded A prosecutors sets “a dangerous precedent” in which “private interests [commandeer] the state’s police powers to target opponents of their policy agenda and hijack the justice system.”

Horner pieced together this invisible funding network by means of extensive Freedom of Information Act requests with multiple AG offices, including Virginia’s.

A key individual in the Bloomberg operation is David J. Hayes, a former Clinton- and Obama-administration official who serves as executive director of the NYU State Energy & Environmental Impact Center. The mission of the center, according to its website, is to support “state attorneys general in defending and promoting clean energy, climate and environmental laws and policies.” Among the specific activities it lists is “working with interested attorneys general to identify and hire NYU Law Fellows who serve as special assistant attorneys general in state attorney general offices, focusing on clean energy, climate and environmental matters.”

Horner’s report does not document the basis for his claim that the NYU initiative is funded by Bloomberg. However, Bloomberg’s backing of anti-Global Warming causes has been widely reported. In 2011, for instance, he donated $50 million to the Sierra Club’s “Beyond Coal” initiative that targets coal-powered generating plants for shutdown. Bloomberg Philanthropies’ most recent 990 public disclosure form, covering 2016, does not list the State Energy & Environmental Impact Center as a grant recipient, but the Center did not become active until late 2017. Daniel Firgir, a member of the Environment Program at Bloomberg Philanthropies, does serve on the State Energy and Environmental Impact Center’s advisory council.

A special assistant attorney for Virginia. The Virginia Office of Attorney General (OAG) engaged with the State Energy & Environmental Impact Center early in the game. On Sept. 27, 2017, Hayes went public with the Center’s first press release, which described plans to “support Attorneys General on legal and communications strategies.”

Hayes had been laying the groundwork for the initiative before issuing the press release. Indeed, one of the state AG officials with whom he had been communicating was Donald D. Anderson, senior assistant attorney general and chief of the Virginia OAG’s environmental section. Two days previously, on Sept. 25, 2017, Anderson had emailed Hayes with an application to hire a special assistant attorney. “We appreciate the opportunity to participate in this program,” he wrote.

In the application Anderson said that Herring had long been committed “to the interests that form the core mission of the State Impact Center — clean energy, climate change more more generally environmental matters.” He cited Herring’s work on the Environmental Protection Agency’s Clean Power Plan, his joining other state AGs in opposition to President Trump’s withdrawal from the Paris Climate Agreement, and his support for Governor Terry McAuliffe’s executive actions to reduce carbon pollution in Virginia.

“The OAG has achieved this track record of commitment to regional and national environmental issues with limited resources,” Anderson wrote. The environmental section is staffed with six full-time line attorneys, two part-time attorneys, and one paralegal. They have a wide range of responsibilities working with numerous state agencies and engaging in litigation on issues such as uranium mining. “The addition of an NYU Fellow would provide a full-time attorney to allow General Herring to participate much more fully in cooperative efforts to advance the agenda represented by the State Impact Center.”

Anderson said the OAG’s office paid $70,000 to $100,000 yearly to attorneys with three to 20 years of experience. He anticipated an appropriate salary for the NYU fellow be approximately $81,500. “We understand that, if selected for the program, our Office would work with the State Impact Center to identify, recruit and extend offers to appropriate candidates,” he wrote.

The Virginia OAG has historically employed, and currently employs, fellows funded by law schools, added Anderson. Although the arrangement with the State Impact Program “would be somewhat different,” Anderson said, he knew of no “Virginia specific limitations or requirements” that would stand in the way of the hiring.  “We have … reviewed the Virginia Rules of Professional Conduct and find no concern about the proposed arrangement, which we understand require that the attorney’s duty of loyalty shall be to the Attorney General and the Commonwealth and its agencies.”

On Dec. 13, 2017, the Center announced that Virginia was one of three second-round grantees. “Three additional attorney general offices will be hiring special assistant attorneys general to work on clean energy, climate and environmental matters of national and regional importance, stated the press release. The three included Oregon, Pennsylvania, and Virginia, bringing the total number of AGs offices under the program to ten.

“Climate change is a real and urgent threat to the health, safety, and economy of Virginia communities from the coast to the mountains, and everywhere in between,” the press release quoted Herring as saying. “The work the State Impact Center is doing to protect our environment and promote clean energy is so important, and I’m glad Virginia is participating in its fellowship program. I look forward to the opportunities this partnership will provide to address climate change and protect our environment for future generations.”

According to Horner, Hayes followed up on the grant by emailing Anderson on Jan. 24, 2018: “Liz,” wrote Hayes, presumably referring to his deputy Elizabeth Klein, “and I would appreciate the chance to come down to Richmond and visit with AG Herring and the team to discuss how we can work together. I’ve had similar meetings with the other AGs that are bringing on Special Assistant AGs, and other AGs who we are working with.”

In a February 2018 press release, Hayes credited states attorney generals with “at least 80 actions to advance and defend progressive clean energy, climate and environmental laws and policies” over the previous year. An online “hub” noted 25 actions undertaken by Herring. These included many actions not directly pertaining to areas of responsibility normally associated with the Virginia AG’s office.

For instance, on Feb. 28, 2017, Herring urged Rep. Lamar Smith, R-Texas, to end “congressional interference” with the subpoenas by the New York and Massachusetts AG offices issued to ExxonMobil Corp.’s regarding its stance on climate change. On June 26, 2017, Herring joined a national “We Are Still In” pledge To maintain commitments to the Paris Climate Agreement. On Dec. 20, 2017, Herring joined other AGs in sending a letter to congressional leaders opposing cuts in the Environmental Protection Agency budget. The letters cited consistently included the ten AG offices that received State Impact Center money.

Did Herring get the money or didn’t he? The State Impact Center December 2017 press release made it clear that Virginia “will be hiring” an assistant attorney general to work on “clean energy, climate and environmental matters of national and regional importance.” Herring signaled that he signed off on the press release by contributing a quote for it.

However, Herring’s office never issued a press release acknowledging the grant. Did the OAG receive the money? Did it hire a NYU law school fellow?

I wrote Michael K. Kelly, director of communication for the OAG, asking: “On Sept. 15, Senior Assistant Attorney General Don Anderson submitted an application to New York University’s State Energy & Environmental Center to hire ‘a Special Assistant Attorney General’ focused on climate-change and clean-energy issues.”

Kelly replied: “Hi Jim—No such funding was received and no such attorney is employed here.”

I followed up by asking in two emails, “Does the AG’s office intend to re-apply in the hope of securing funding in the future?”

Kelly did not reply to either email.

Did the OAG have a change of heart regarding the propriety of taking private money to fund a new position? An argument can be made that while the OAG is free to accept outside money, it has no authority to spend it — unless such funds are allocated by the General Assembly.

Whatever the case, Herring announced last month that he would no longer accept campaign contributions from state-regulated monopolies. As he told the Blue Virginia blog, as reported by the Richmond Times-Dispatch, the AG also said he would take no money from lobbyists or senior executives of state-regulated monopolies. By contrast, he has accepted $175,000 from Charlottesville millionaire Michael Bills, founder of Clean Virginia, who has offered financial support for any candidate spurning money from Dominion Energy.

The Times-Dispatch article did not raise the issue of the AG’s office accepting money from private sources.

Update: Chris Horner has provided a copy of a memo from Chris Moyer, communications director of the State Impact Center to Michael Kelly, communications director for the OAG. The memo both documents Horner’s contention that Bloomberg was a major funder of the Center and illustrates, as of November 2017, the Center’s expectation of collaborating with Herring’s office in the communications/public relations arena. View memo.